Realtors: Home sales now a 'buyer's market'
Sales fell for third straight month in June; nearly flat prices make double-digit gains seem like a distant memory.
NEW YORK (CNNMoney.com) -- It's official - even the nation's leading group of real estate agents now says it's a buyer's market in housing, as a soaring supply of homes for sale means nearly flat prices and longer waits for sellers.
The news came in the National Association of Realtors' report for June, which showed that home sales fell to the slowest pace since January while price gains were the smallest in over a decade.
The industry group said sales of existing homes fell to an annual rate of 6.62 million in June, compared with a 6.71 million pace in May. Economists surveyed by Briefing.com had forecast sales would slow to a 6.60 million rate.
June was the third straight month of declines, leaving sales 9 percent below year-ago levels, the group said. Moreover, the weakness was widespread, with sales falling in each of the four regions of the country.
The median home price did edge up to $231,000 from $229,000 in May.
But that marked only a 0.9 percent increase from a year earlier - the smallest year-over-year gain in home prices since May 1995.
As recently as October, prices had jumped a record 16.8 percent from a year earlier due to tight supplies and bidding wars among buyers.
"The change in price performance is directly tied to housing inventories - a year ago we had a lean supply of homes and a seller's market, with monthly home sales at an all-time record high," David Lereah, chief economist for the group, said in a statement.
"Sellers have recognized that they need to be more competitive in their pricing given the rise in housing inventories," he added.
The inventory of homes on the market is now at 3.7 million, up a whopping 39 percent from a year ago, or a 6.8-month supply at the current sales pace, up from a 4.4-month supply in June 2005.
The Realtors statement said the market has shifted to a "buyer's market," which it said is good news for those shopping for a home even if it posed a problem for those looking to sell.
"People who were discouraged by the bidding wars that were so common over the last few years are finding more choices now," said Thomas Stevens, a Realtor from Vienna, Va., who is president of the group.
Regionally, existing home sales in the Northeast saw the biggest decline, followed by the South.
Sales in the South fell 2.3 percent from May to a annual pace of 2.57 million, which was 5.5 percent below the rate a year earlier. The median price slipped to $191,000, down 0.5 percent from a year earlier.
Northeast sales slid 3.5 percent from the prior month and were 9.8 percent below a year ago. The median price in the Northeast was $298,000, up 7.2 percent from June 2005.
Sales in the Midwest were unchanged from a month earlier and down 6.2 percent from a year ago. The median price in the Midwest was $175,000, 1.7 percent below June 2005.
Existing-home sales in the West were also unchanged from May but sank 17.1 from June 2005. The median price in the West was $342,000, the same as a year ago.
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